FCC approves Sprint/Nextel Deal

[agentHibby]

Here is the document from the FCC

Originally Posted by FCC.gov

FCC CONSENTS TO SPRINT CORPORATION ACQUISITION OF
NEXTEL COMMUNICATIONS LICENSES AND AUTHORIZATIONS

WASHINGTON, D.C. – Today, the Federal Communications Commission (FCC) consented to the applications filed in connection with the proposed merger of Sprint Corporation (Sprint) and Nextel Communications, Inc. (Nextel). Sprint is currently the third largest provider of commercial mobile telephone service based on subscribership, while Nextel is the fifth largest.

With today’s action, the Commission approves the transfer of control of all licenses and authorizations held directly and indirectly by Nextel to Sprint. These licenses and authorizations include: Specialized Mobile Radio (SMR) licenses in the 800 and 900 MHz bands, licenses in the 1.9 GHz band that resulted from the 800 MHz rebanding proceeding, Broadband Radio Service (BRS) licenses in the 2.1 and 2.5 GHz bands, and leases of Educational Broadband Service (EBS) spectrum in the 2.5 GHz band.

The FCC concluded today that Sprint’s acquisition of Nextel’s licenses will serve the public interest, convenience, and necessity, and that the likely public interest benefits of the merger outweigh any potential public interest harms. These public interest benefits include enhanced service quality and broader deployment of advanced wireless services. Based on the record developed in this proceeding, the FCC believes this transaction is unlikely to result in collusive, anti-competitive behavior or create unilateral market power on the part of the merged entity. In addition, the FCC finds that there are no local markets where the post-merger competitive environment would require a divestiture of spectrum, networks, or customers.

In analyzing the effects of the proposed merger on the mobile telephony market, the Commission concluded that, in the post-merger market environment, there will be a continued presence of several other carriers with the ability to add subscribers and act as effective competitive constraints on the behavior of the merged entity. While the number of large nationwide carriers will be reduced from five to four as a result of the transaction, the FCC determined that carrier conduct will remain sufficiently competitive to ensure that market performance will not be impaired, and, given the expected benefits, the public interest will be enhanced on balance.

The FCC also analyzed the impact of the merger on roaming and imposed a condition specifying that Sprint Nextel may not prevent its subscribers from reaching another carrier and completing calls via manual roaming, unless specifically requested to do so by a subscriber. Given the broad scope of the roaming concerns raised in this proceeding, the FCC has decided that roaming issues would be more appropriately addressed in a separate proceeding. As announced in the FCC’s Alltel-Western Wireless merger decision, the FCC plans to initiate a proceeding in the near future to examine whether the current roaming requirements applicable to mobile telephone carriers should be modified to address current market conditions and developments in technology.

With regard to the effect of the merged entity’s accumulation of BRS/EBS spectrum in the 2.5 GHz band, the FCC concludes that, because this spectrum is in an early state of transition to a new band plan and new uses by licensees, neither public interest harms nor benefits are likely to result in the near term from the merger. The Commission believes that this transaction will not have a negative impact on competition in the markets for the products that are or will ultimately be supported by this spectrum, whether they be voice, broadband, video, or other wireless services offered on mobile, fixed, or portable basis.

As a condition to its approval to the merger, the FCC is requiring that Sprint Nextel fulfill its voluntary commitment to meet certain milestones for offering service in 2.5 GHz band, unless circumstances beyond its control prevent the merged entity from reaching those milestones. In addition to other specific implementation requirements agreed to by Sprint Nextel, the first milestone requires Sprint Nextel to offer service using BRS/EBS spectrum to at least 15 million Americans within four years of the effective date of the order consenting to the merger, and the second milestone requires the company to serve an additional 15 million Americans within six years.

Finally, in their merger application, Sprint and Nextel stated that, if their transfer of control application were approved, Sprint would spin-off its local wireline business, Sprint Local Division. The Commission expressly notes that letters submitted by the CEOs of Sprint and Nextel represent commitments that the new local wireline company, LTD Holding Company, will receive an equitable debt and asset allocation at the time of its proposed spin-off so that the company will be a financially secure, Fortune 500 company.

Action by the Commission on August 3, 2005 by Memorandum, Opinion and Order, (FCC 05-148). Chairman Martin, Commissioners Abernathy, Copps, and Adelstein.

Attached are statements issued by Chairman Martin, and Commissioners Abernathy, Copps, and Adelstein.

For additional information, contact Louis Peraertz, Wireless Telecommunications Bureau, at (202) 418-1879 or Louis.Peraertz@fcc.gov.

WT Docket No. 05-63
– FCC –

[agentHibby]

what does all this mean??
Sprint Nextel gets thumbs up and no wireless divestments required

Like Alltel they can't block roaming unless the customer does not want roaming.

Sprint Nextel must use the 2.5 GHz band BRS/EBS spectrum to at least 15 million Americans within four years.

Sprint if spinoffs its wireline operation, it must be in good shape in terms of debt and assets to be a Fortune 500 company.

[larry]

Wow breaking news. Good find there.

[Chris L]

Originally Posted by agentHibby

Here is the document from the FCC

Excellent news! DOJ also approved the deal today, so I guess it's time for them to break out the yellow and black shirts.

[larry]

Yep it's official now. We now can say we have nearly 40 million customers.

[Matt]

Originally Posted by larry

Yep it's official now. We now can say we have nearly 40 million customers.

Not yet. Maybe tomorrow. Sprint said they will close the merger "shortly", but all the approvals are in place.

[bobolito]

Congratulations Larry and Chris! Now you feel the joy we had last year on October 26th!

I wish Sprint and Nextel the best in this new venture.

[Yankees368]

Hurray! Now lets see sprint start putting some pannels on Nextel towers!

[WiggyFife]

hooray for Sprintextelularco!!!

[ehcruzan]

I was surprised how "quietly" this happened. There were no strong rumors leading me to expect it this week...just soon. They are also fortunate to have no divestiture requirements. I guess it's due to the incompatible technologies.


On Wednesday, the FCC delivered a unanimous decision among its four commissioners -- evenly split between Democrats and Republicans.

That usually takes a bit of negotiation to accomplish.

[larry]

Originally Posted by Yankees368

Hurray! Now lets see sprint start putting some pannels on Nextel towers!

That's already happening out here in CA.

[larry]

Originally Posted by Matt

Not yet. Maybe tomorrow. Sprint said they will close the merger "shortly", but all the approvals are in place.

Ok ok you got me on a technicality.

[Fire14]

Wow, that is good to hear & no wild diverstures either, guess the consultants they hired that did the Cingular/AWE Merger learned a few things as well.
This will make for an interesting future to see the direction this takes us all in the wireless world, and hope the mergers don't cause prices to go up, but cause more competition in the field.

[Matt]

The Washington Post reported today that the merger will close sometime within the enxt two weeks, but you won't see any changes in the marketing, etc until October.

[NYCDru]

Way to go. We are about to have a hree way dance in wireless on the national (35 Million plus) level. What is there for T-Mobile to do now?

[Matt]

T-Mobile isn't going to do anyting (major). They've said that before, and they made their decision when they decided not to bid for AT&T Wireless, the only significant GSM player that was available. They might buy Suncom (IMO) but that would be their only acquisition. They have added numerous roaming agreements with small GSM providers this year, filling some of the gaps. Indications are that 850 roaming agreements are right around the corner, building on the MN/MI 850 roaming they officially added a few months ago. They are certainly growing just fine. On 6/30/2001 (one month after the VoiceStream and Powertel mergers were complete), the company had about 5.9M subscribers, and when they report Q2 next week (marking 4 years from the date above) they will have in excess of 19M subscribers, and continued profitability.

[WirelessBeachBum]

Originally Posted by Matt

T-Mobile isn't going to do anyting (major). They've said that before, and they made their decision when they decided not to bid for AT&T Wireless, the only significant GSM player that was available. They might buy Suncom (IMO) but that would be their only acquisition. They have added numerous roaming agreements with small GSM providers this year, filling some of the gaps. Indications are that 850 roaming agreements are right around the corner, building on the MN/MI 850 roaming they officially added a few months ago. They are certainly growing just fine. On 6/30/2001 (one month after the VoiceStream and Powertel mergers were complete), the company had about 5.9M subscribers, and when they report Q2 next week (marking 4 years from the date above) they will have in excess of 19M subscribers, and continued profitability.

Don't forget they also have Paris Hilton as a customer....or at least had her.

[danny boi]

Originally Posted by Matt

T-Mobile isn't going to do anyting (major). They've said that before, and they made their decision when they decided not to bid for AT&T Wireless, the only significant GSM player that was available. They might buy Suncom (IMO) but that would be their only acquisition. They have added numerous roaming agreements with small GSM providers this year, filling some of the gaps. Indications are that 850 roaming agreements are right around the corner, building on the MN/MI 850 roaming they officially added a few months ago. They are certainly growing just fine. On 6/30/2001 (one month after the VoiceStream and Powertel mergers were complete), the company had about 5.9M subscribers, and when they report Q2 next week (marking 4 years from the date above) they will have in excess of 19M subscribers, and continued profitability.

If they filled in their coverage holes with massive 850 MHz roaming agreements to rival Cingular's coverage, I would think that could get expensive assuming customers take advantage of it.

Do you think they would raise prices to address these additional expenses?

[chris4434]

tmobile is really going to need to do SOMETHING to keep competing with sprint/verizon/cingular. buying suncom would be a good idea. i think at the rate they are going that eventually alltel will take the #4 spot and push tmobile back to #5

[NYCDru]

Something that T-Mobile has that the other carrir's don't. Atractive prices/plan packages. They are now the low coast leader. They only need to cover the cities REALLY well. There prices have gone down a litle while no one else has made any really atractive offers. I thinkt hat 4th quater this year as usual they will offer something fantastic (1000 min + Unlimited N&W + maybe 7pm nights. for under 49.99/month). They have gained 14 million customers in 4 years. I wouyldn't count them out just yet.